Data

Data | Centre's tax revenues grew despite stringent lockdown on the back of excise duties

Tax revenues increase due to sharp rise in union excise duties  

In FY21, despite a stringent lockdown and a raging COVID-19 first wave, the gross tax revenue collected by the Centre increased over FY20. However, the increase was made possible by a sharp rise in contributions from union excise duties. This compensated for the sharp drop in the share of corporate tax collection. The shift in tax burden from the corporates to the masses has come at a time when the pandemic has led to many job losses and reduced income levels thereby pushing more people into poverty.

Higher collections

Despite a national lockdown, the gross tax revenue grew in FY21 compared to FY20. About 20.24 lakh crore was collected in FY21.

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Tax burden

In FY21, the share of income tax (23.2%) in the gross tax revenue exceeded the contribution from corporate tax (22.6%). The Central Goods and Services Tax also contributed a similar share (22.5%). The contribution from union excise duties rose sharply from 12% to 19.2% compensating for the loss in share from corporate tax which fell sharply from 27.7% to 22.6%.

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Slipping into poverty

According to the Pew Research Center, the number of poor people in India (incomes <=$2 a day) is estimated to have increased from almost 6 crore to 13.4 crore due to the pandemic. The chart shows the estimated number of people (in crore) in each income tier in 2020 before and after — the COVID-19 induced lockdowns.

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Also read: CII urges ₹3-lakh crore stimulus

Consuming less

In FY21, while fuel consumption decreased by more than 10%, the contribution of union excise duties to the overall tax revenue increased by 7% points.

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Also read: BJP members of House panel flag rising fuel prices

 

 

 

 


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Printable version | Jul 25, 2021 7:00:37 PM | https://www.thehindu.com/data/data-centres-tax-revenues-grew-despite-stringent-lockdown-on-the-back-of-excise-duties/article34850754.ece

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